It's common practice today for companies to form alliances or joint ventures. In theory, these partnerships make sense. After all, no company has the scale, skills and reach to do everything - especially if its business depends heavily on information and communications technologies. Not since the early days of General Motors has a company tried to build a totally vertically integrated enterprise.
Stories by Jim Champy
The phrase "New Economy" doesn't have a hard-and-fast definition. You can decide for yourself what it means. When most people speak of the New Economy, they're usually referring to the Information Age, the Internet or something digital. The phrase also conjures up a vision of roller-coaster capital markets, speed, breathlessness and exuberant spending.
A nervous investment fund manager called me recently, wondering whether demand in the IT services industry was slowing. Had the long-predicted post-Y2k crash finally hit? Several major systems-integration firms reported lower-than-expected second-quarter earnings. The stock market extracted its penalties for those failures to meet analysts' expectations. Then Computer Associates International Inc. announced "disappointing" results. Whack: 42 percent off its share price in one day.
It's hard to predict which technologies will truly change the way we work, dramatically improve productivity or otherwise radically affect the human condition. That's because we think deductively: Define a problem, then find a solution. Forecasting the real impact of technology requires inductive thinking: Recognize a new technology's potential, and then find a problem it might solve.
Capital markets have spoken. The promise of profits in business-to-consumer e-commerce is hollow - at least for now. Money to build the Amazon.com Inc.s of the future will be harder to come by. Peapod, the nation's first online grocery-shopping service, needed a cash infusion from a supermarket chain. The market caps of most consumer e-commerce companies have dropped dramatically.
"We're struggling," the executive said. "We missed a technology cycle." The lament came from the CEO of a software company when I asked how business was going. Somehow, his company had failed to update its products to take advantage of a new generation of operating systems. As a result, the company was having a hard time competing. It probably would survive, but it would be playing an exhausting game of catch-up for some time.
If Steve Case and Jerry Levin weren't such good executives, I would fear for their corporate survival. Shortly after last month's announcement of the AOL Time Warner Inc. merger, they were touted on one magazine cover as "Men of the Century." Such praise can often lead managers to believe they're infallible. Business troubles often follow.
I have always believed in the importance of ambition. It is, after all, the root of all achievement. At the same time, I have also been aware - more so today - that ambition can have its dark side. It can easily lead to overreaching by an individual or a company. Reality is ignored and hubris takes over, while the need for competence is often overlooked and no longer rewarded.
The "global economy" is a myth.
Predicting the future is a dangerous game -- unless you don't have any business riding on what you see in your crystal ball. That's the condition for most futurists: they predict, we listen, and most of the time we take the business risk. So it's worth keeping score of predictions. Here's one I think is wrong -- the demise of the middleman.